Amid the U.S. Department of Commerce tightening export controls against China, it has launched an expanded investigation into Applied Materials, the second-largest semiconductor equipment company in the world.
According to Bloomberg News on the 26th, Applied Materials announced last week that it received another subpoena from the Bureau of Industry and Security (BIS) of the U.S. Department of Commerce earlier this month. This marks the second subpoena, following one in November last year.
Applied Materials stated in a disclosure, “We are cooperating fully with the government in these matters. These matters are subject to uncertainties, and we cannot predict the outcome nor reasonably estimate a range of loss or penalties, if any, relating to these matters.”
The U.S. government restricts certain types of semiconductor equipment exported to China to prevent China from acquiring advanced technology that threatens national security. Applied Materials has been under investigation since February for its trade situation with Chinese companies following the start of export controls to China in 2022. Furthermore, it has become the subject of an investigation by the U.S. Securities and Exchange Commission (SEC).
Although Applied Materials’ sales have declined since the commencement of U.S. export controls against China, China is still a large market, accounting for about 25% of the company’s sales. Chinese companies are spending substantial funds on importing old equipment, essential for electric vehicles and factory facilities, despite the restriction on imports of advanced equipment have been blocked.
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